Consolidation sparks pension dispute in Warren

Planned changes to the city of Warren’s employee retirement systems are under fire by the city treasurer and others who wonder if some officials also have bigger, hidden plans.

Following the retirement of the Warren Police & Fire Retirement Commission’s administrator/accountant, the City Council voted recently to eliminate that job and create the post of “director” to oversee that pension system on a daily basis.

But for the first time, anyone hired for that role also would be required to direct the daily operation of the General Employees Retirement System, which has its own administrator and an accounting technician.

The scenario troubles Treasurer Carolyn Kurkowski Moceri, who, under state law, is required to hold a seat on the police/fire pension board by virtue of her title.

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“This (change) is a road map on how to disassemble a stellar pension plan,” warned Moceri of the police/fire retirement fund and it’s nearly $300 million in assets. “When they proposed this, my jaw dropped.

“We want a director for our own fund. We don’t want to combine the two.”

Commission members, entrusted with making investment decisions for the police/fire retirement board, are seeking a successor to former administrator/accountant Gregory Suma, who retired March 31.

They requested funding to boost the department staff for the hiring of a part-time accountant while continuing to keep an “administrative specialist” on board.

The council responded on May 13 by providing funding for: one director to oversee both retirement systems and a $3,843 raise for the specialist who handles clerical duties. Money for a part-time accountant was not included.

Three days later, the commission expressed its concerns in a letter to the council.

“The proposed restructuring is a material chance which requires further review and consideration. Accordingly, the Police and Fire Retirement Commission requests that the City Council reconsider and rescind its foregoing action,” the commissioners wrote.

City Controller Robert Maleszyk said Tuesday that a single, cross-trained staff of four people could improve service to employees when they submit their retirement notices, and that the transition from one director to a successor would be smoother.

“To me, it made a lot of sense,” he said.

Proponents of the restructuring emphasize that nobody is proposing the combining of the two pension boards that hold hundreds of millions of dollars in combined assets.

The police/fire retirement system holds almost $300 million, and the general employees’ plan has approximately $120 million plus $30 million in a health care trust.

Both retirement boards are autonomous and have the power to hire their own individual administrator. As a result, the restructuring of the staffs won’t move forward unless both boards concur.

The General Employees Retirement System Board of Trustees plans to discuss the restructuring at its regular meeting Wednesday. Chairwoman Christine Cassani said the reorganization of the staff creates “several issues” but she declined to elaborate or predict what action the board might take.

“Council had no authority to remove that position and I was not going to vote for a budget with that (director’s job) in it,” Councilwoman Kelly Colegio said.

“I’m not concerned about it. I think it will work,” said Councilman Patrick Green, who along with Council president Cecil St. Pierre led the restructuring.

Green serves as a voting member of the general employees’ retirement board as the council’s representative. St. Pierre is the ex-officio to the police/fire pension panel.

The dispute has some city retirees feeling concerned.

“I seriously doubt you can trust any politician that has control over money earned by someone else,” said Eric Schulz, who retired from the Warren Police Department in 2011.

Meantime, Suma is now employed by Macomb County as the retirement administrator of the four plans covering county government retirees. Until his replacement in Warren is chosen, he has continued working for the city about 20 hours per week, he said, helping officials prepare for next week’s audit of the police/fire retirement fund.